News Roundup: RyanAir, Lauda, Icelandair, US, AirFrance, Air Canada, SAA, Finnair,

RyanAir

The airline says that when it starts flying again it’s going to launch a price war and undercut everyone everywhere. The airline groups head, Michael O’Leary, is furious at the EU for having allowed state bailouts and loans to airlines against its own rules. He says – and the EU Council has accepted the argument as valid, that state aid will distort the market and cut competition.

O’Leary’s Darwinian approach to business where only the fittest, most vicious and adaptable survive, may be suitable in normal times, but the loss of swathes of airlines and hundreds of thousands of jobs, never mind the strategic economic impact of so many airlines going out of business would be too much for any country to bare.

He’s not wrong in that eventually new airlines would appear, but RyanAir has always used its pricing power and size to eliminate smaller airlines. Eventually Darwinism leads to monopolies. Look how humans have come to monopolise the planet, it’s no different.

Lauda

The RyanAir subsidiary is to have its main base closed in Vienna if unions don’t agree terms for new contracts. Yet again O’Leary in a harsh display of corporate Darwinism, has basically told them it’s a do or die moment.

Nobody negotiates, it’s take it or leave it and the Austrian unions are wrong if they think he’ll blink first. O’Leary is an accountant by training and he’s only interested in this financial year and future ones. The past is dead. There’s no such thing as social responsibility in the ULCC world of RyanAir.

Finnair

Finnair has announced the resumption of some services in June as it starts to rebuild its network.

It’s also converted two A330-300’s to cargo operations by removing the seating, to take advantage of the current cargo boom.

Finnair frankly deserves an award. They way it behaved towards customers – well before anyone else did, it led the way in offering refunds, transfers, point and tier extensions, far sooner than anyone else. It’s capacity for creating customer goodwill is outstanding.

Icelandair

Has agreed a deal with unions and staff to secure its future out to 2025, in such a way that both sides get what they need and work in harmony to preserve the airline and jobs. Pay cuts and service and productivity changes will help the airline get back on its feet. A very different cooperative approach some airlines could learn from.

Air Canada

Air Canada has announced its furloughed 50% of its staff through all of June. The airline is keeping a low profile and aiming to preserve its cash while demand picks up, however slowly.

Some major city routes such as London and Frankfurt will operate passenger routes but mostly cargo.

AirFrance

Is planning to put as much as 15% of its routes back into service from June 1st, key cities first and the DomToms are high on the list, a relief for places in the Caribbean, Pacific and Indian Oceans that are considered to be French mainland but have been largely been cut off with minimal connectivity.

South African Airways

SAA is in deep trouble, with three of its A330’s having been sent back to their lease company owners. The political squabbling over how the airline is being wound up, possibly used to create a new business, and the horrendous costs involved in the bankruptcy process, have caused huge controversy.

Over US$1 billion has been effectively blown just in keeping the bankrupt airline operating. Even the accountants sent in to run the airlines bankruptcy and transfer to a new business, admitted they were not experts in airlines, and had to bring in another company who were.

The whole thing is embarrassing the government, and nobody understands how it’s taken five months to achieve nothing except the expense of keeping the airline in stasis.

US airlines and Covid19

The message is please wear a mask but we won’t make you. In a typical example of American ‘exceptionalism’, the airlines are asking everyone to wear masks, but rather than enforce the issue, they’ll do nothing.

Rather than make it a condition of buying a ticket – and refusing boarding to anyone without, already happening around the world, personal rights to sit and and contaminate others or be contaminated, will be upheld. Crews have been told not to press anyone who refuses.

The country is rushing towards reopening business – Texas showed a record increase in cases of 1,800 on the first day of eased restrictions and elsewhere there are fears of a renewed spike in the pandemic.

Many see aviation and crowded aircraft flying domestic routes in the US as a disaster waiting to happen as new clusters seem set to emerge.